Rebels in Myanmar's Kokang region say fighting has intensified in the area since the military launched a large scale offensive against rebel positions this week.

Tun Myat Lin, a spokesman for the Kokang rebels, told VOA's Burmese service the government is treating the offensive like it is handling a foreign invasion.

"It was very severe yesterday. From 5 a.m. through midnight, they were still fighting on the ground and they used artilleries. But then later, artilleries were used the whole night. Today, even til now, they are still using artilleries, and fighting is still happening on the ground," he said.

He added that as many as 160 rebels have been killed or wounded in the fighting.

The government has not given formal casualty figures, but state-run media outlets have said two soldiers were killed and five wounded during heaving fighting near the town of Laukkai this week.

China's state-run Global Times newspaper is reporting that Myanmar has proposed more than $11,000 in compensation for the families of five Chinese nationals who died when a bomb landed on the Chinese side of the border last week.

But Myanmar spokesman Ye Htut told VOA his government has not yet discussed compensation numbers with China.

He added that the cause of the bombing is still under investigation, repeating government allegations that the rebels may have launched the bomb that landed inside China.

"We also have to go to that area to investigate the type of bullet, because it is also possible that [the] Kokang military did it to create problems between the two sides. To find this out, an investigation is now going on. So far, I do not know anything more than this," he said.

The rebels have denied any involvement in the bombing and China has said Myanmar's Air Force clearly was responsible for the incident.

The Myanmar government has accused local Chinese officials and other ethnic groups of assisting the rebels and has called for China's help in preventing attacks launched across the border.